Building Marketing Growth Engines For Acquisition By Diversifying
Demand generation is a core focus for most tech startups/companies as it provides a quick feedback loop (read: dopamine hit to the marketer that’s responsible) on what works and what doesn’t. Basically, providing a growth engine for companies that are able to achieve a positive return on their investments, it’s one of the main reasons why so many DTC companies have been able to grow quickly. That’s why it’s no surprise that most investment dollars in digital marketing (over 60 cents over every digital advertising dollar spend goes to them) are going to the biggest players: Google, Facebook, Amazon, Microsoft, and other (social) platforms.
A need for alternatives, but are there really any?
Diversifying your demand generation strategy is always worth it. We, as marketers, have seen cost per click increase for all the major channels for years, mainly due to increased competition and a change in consumer trends (on a macro level: pandemic, inflation). This has resulted in diminishing returns for many companies as their investments previously were generating 1.1 dollars for every dollar invested. It’s slowly going negative if companies don’t find a way to increase their own margins or find a way to be more efficient (by decreasing CPC or increasing conversion rate, for example).
The expanding role of channel expansion
So how often do you evaluate and experiment with new demand generation channels? How quickly can you adopt new channels as a consumer-focused marketing organization? While new platforms always have some issues early on (they’re often in beta when the first customers get access), it’s always interesting to see how you can adopt them as part of your mix of channels. Many times a year new players have come out with their offering to reach, often more targeted niche, audiences.
Early learnings provide a considerable upside. It was always about being 1st.
While not every company is a first mover in your space (obviously), you can have a first-moving advantage for new channels. Being able to adapt to new channels quickly, you often gain a huge advantage.
In the past years, many new advertising platforms have come up where you could gain access to millions of users. Some are more relevant for your product or company. Examples are TikTok, Nextdoor, Hulu/Roku, and many other streaming services, Reddit and others. In all those cases you could be first in your category and try them out. The most successful startups and scale-ups that have discovered their own growth engines are able to rapidly test and evaluate with new channels to see how they can take advantage of them.
What does it take?
Besides a growth mindset it's important to have a foundation of marketing analytics that can quickly help assess the potential return. Having the ability within your team to make time available for experiments is second. By combining the power of both you’re able to quickly convince yourself and the rest of your organization on how new channels can provide an upside in your strategy. Maybe it will help create uplift, make your overall funnel more efficient which saves you cost.
What new channels are you planning to make part of your expansion efforts in 2022?